The more I read the rules on this, the less clear it becomes.
Fact pattern I'm following - Schedule E instructions
Qualified Joint Venture
"If you and your spouse each materially participate (see Material participation in the Instructions for Schedule C) as the only members of a jointly owned and operated rental real estate business". I think we meet test 2 (and 3) - our participation was substantially all of the participation, and in total we definitely put over 100 hours into the rental. Also, I believe we do qualify for QBI deduction since we do meet the qualifications under Rev Proc 2019-38.
Facts on other side - we don't participate over 500 hours, and do not qualify as real estate professionals.
Essentially, I want to be sure I elect this if I need to, but don't want to go to the effort of splitting it up if that is unnecessary. It seems to me that if it wasn't for the QBI considerations, it would be best to take this as passive income (which is of course how it is treated anyway). However, with those also at play here, I don't want to contradict the presumption that this is a trade or business by NOT electing QJV if I should check it.
(To further compound matters, we moved to a small farm and DO need to split the income and expenses from the farm 50/50 by filing 2 Schedule Fs for 2018...what a year this is!!!)
